Spitzer made the announcement without having finalized a plea
deal with federal prosecutors, though a law enforcement source
familiar with the investigation said he is believed to still be
negotiating one. The official spoke on condition of anonymity
because of the sensitivity of the case.

"I go forward with the belief, as others have said, that as human
beings our greatest glory consists not in never falling, but in
rising every time we fall," Spitzer said at a Manhattan news
conference with his wife, Silda, at his side.

He left without answering questions.

“I cannot allow my private failings to disrupt the people's work.”

New York Gov. Eliot Spitzer

Spitzer will be replaced, effective Monday, by Lt. Gov. David
Paterson, who becomes New York's first black governor. He will be
the state's first legally blind governor and its first disabled
governor since Franklin D. Roosevelt.

The scandal erupted Monday when allegations surfaced that the
48-year-old father of three teen daughters spent thousands of
dollars on a call girl at a swanky Washington hotel on the night
before Valentine's Day.

Spitzer was more composed than he was earlier in the week, when
he apologized for an undisclosed personal failing and looked pale,
drawn and glassy-eyed. His wife took deep breaths as each of
Spitzer's words was accompanied by a rush of camera clicks.

"I look at my time as governor with a sense of what might have
been," Spitzer said.

The announcement followed two days of furious activity. Calls
for his resignation came immediately. Republicans began talking
impeachment if he didn't step aside.

The case started when banks noticed frequent cash transfers from
several accounts and filed suspicious activity reports with the
Internal Revenue Service, a law enforcement official told The
Associated Press.

The accounts were traced back to Spitzer, leading
public corruption investigators to open an inquiry.

Law enforcement officials said he was the person identified as
"Client 9" in court papers who paid thousands for a night in a
Washington hotel with a prostitute named Kristen. According to an
affidavit, a federal judge approved wiretaps on the phones of the
escort service in January and February.

Investigators found that during the Washington tryst, Spitzer
used two rooms at the Mayflower Hotel -- one for himself, the other
for the call girl. Sometime around 10 p.m. on Feb. 13, Spitzer
sneaked away from his security detail and made his way to her room,
a law enforcement official said.

The officials spoke to the AP on condition of anonymity because
of the sensitivity of the case. Spitzer has not been charged in the
case.

In a statement issued after the announcement, U.S. Attorney
Michael Garcia said there was no deal with the fallen governor.

"There is no agreement between this office and Governor Eliot
Spitzer, relating to his resignation or any other matter," said Garcia.

Spitzer, a first-term Democrat, built his political reputation
on rooting out government corruption, and made a name for himself
as attorney general as crusader against shady practices and overly
generous compensation. He also cracked down on prostitution.

He was known as the "Sheriff of Wall Street." Time magazine
named him "Crusader of the Year," and the tabloids proclaimed him
"Eliot Ness."

The square-jawed graduate of Princeton University
and Harvard Law was sometimes mentioned as a potential candidate
for president.

He rode into the governor's office with a historic margin of
victory on Jan. 1, 2007, vowing to stamp out corruption in New York
government in the same way that he took on Wall Street executives
with a vengeance while state attorney general.

His term as governor has been fraught with problems, including
an unpopular plan to grant driver's licenses to illegal immigrants
and a plot by his aides to smear his main Republican nemesis. The
prostitution scandal, some said, was too much to overcome.

Barely known outside of his Harlem political base, Paterson, 53,
has been in New York government since his election to the state
Senate in 1985. He led the Democratic caucus in the Senate before
running with Spitzer as his No. 2.

Though legally blind, Paterson has enough sight in his right eye
to walk unaided, recognize people at conversational distance and
even read if text is placed close to his face. While Spitzer is
renowned for his abrasive style, Paterson has built a reputation as
a conciliator.

At a morning news conference, Senate Majority Leader Joseph
Bruno, Spitzer's chief rival, said he had not yet heard from the
governor but that he was moving on with the business of the state.
Lawmakers were set to vote on budget bills Wednesday afternoon.

"We are going to partner with the lieutenant governor when he
becomes governor," said Bruno. "David has always been very open
with me, very forthright ... I look forward to a positive,
productive relationship."

Bruno, though the next highest-ranking official, does not become
lieutenant governor upon Paterson's ascension to governor.

The
lieutenant governor's office would remain vacant until the next
general election in 2010 under state law. However, whenever
Paterson is out of state or if he were to become incapacitated,
Bruno would be acting governor.